First-time buyers can now get on the property ladder with a deposit of just £2,000

The new shared ownership rules should come into affect in the next few years

New shared ownership rules have made it easier than ever for first-time buyers to get a foot onto the property ladder.

Related: Calling all first time buyers! Halifax has launched a new no-deposit mortgage (opens in new tab)

Changes to the scheme mean that first-time buyers can land a house with a deposit of just £2,000. The changes to the shared ownership scheme were announced last month by the housing secretary Robert Jenrick at the Conservative Party conference. The measures were then confirmed last week by the Ministry of Housing, Communities and Local Government.

The shared ownership scheme allows buyers to purchase a portion of shares in the property while the housing association owns the rest. The scheme helps lower the mortgage (opens in new tab) and owners simply pay rent on the share of the property that they don't own.

hallway with white wall and carpet on flooring with clock on wall

(Image credit: future PLC/Colin Poole)

At the moment, first-time buyers (opens in new tab) need to purchase a minimum share of a home of 25 per cent. However, the new rules will lower this to 10 per cent. This means that in areas with cheaper house prices, buyers will only need a deposit of £2,000.

It sounds almost too good to be. However, it gets even better. When the new Right to Shared Ownership rules come into effect owners will be able to buy more shares in the property in increments of just one per cent. A marked difference to the current minimum of 10 per cent.

living room with grey wall and glass table with flower on glass jar

(Image credit: future PLC/Brett Charles)

This is good news for landing a mortgage, as the small amount of shares means people are less likely to need a bigger mortgage. The government has also promised to 'cut the fees charged' to buy more shares in a property – such as legal fees, surveys, mortgage fees and stamp duty (opens in new tab). Currently, owners have to pay stamp duty on any extra portion of shares they buy because they are no longer classed as first-time buyers.

The government has yet to announce when these rules will be coming into force.

Related: You could have an extra £78,000 added to your mortgage if you fail to do THIS (opens in new tab)

'These measures will mean more people, including residents living in new housing association homes, are given the opportunity to get on to the housing ladder,' said Mr Jenrick.

Rebecca Knight
Rebecca Knight

Rebecca Knight has been the Deputy Editor on the Ideal Home Website since 2022. She graduated with a Masters degree in magazine journalism from City, University of London in 2018, before starting her journalism career as a staff writer on women's weekly magazines. She fell into the world of homes and interiors after joining the Ideal Home website team in 2019 as a Digital Writer. In 2020 she moved into position of Homes News Editor working across Homes & Gardens, LivingEtc, Real Homes, Gardeningetc and Ideal Home covering everything from the latest viral cleaning hack to the next big interior trend.